IGPL.NS WACC - Weighted Average Cost of Capital
The WACC of I G Petrochemicals Ltd (IGPL.NS) is 15.9%.
| Range | Selected | |
| Cost of equity | 16.4% - 19.0% | 17.7% |
| Tax rate | 25.5% - 25.6% | 25.55% |
| Cost of debt | 8.1% - 9.0% | 8.55% |
| WACC | 14.8% - 17.1% | 15.9% |
| Category | Low | High |
| Long-term bond rate | 6.9% | 7.4% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 1.15 | 1.19 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 16.4% | 19.0% |
| Tax rate | 25.5% | 25.6% |
| Debt/Equity ratio | 0.18 | 0.18 |
| Cost of debt | 8.1% | 9.0% |
| After-tax WACC | 14.8% | 17.1% |
| Selected WACC | 15.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| IGPL.NS | I G Petrochemicals Ltd | 0.18 | 1.18 | 1.04 |
| 500655.BO | Garware Polyester Ltd | 0.07 | 1.14 | 1.08 |
| BODALCHEM.NS | Bodal Chemicals Ltd | 0.92 | 1.34 | 0.79 |
| DCW.NS | DCW Ltd | 0.18 | 1.5 | 1.32 |
| ESTER.NS | Ester Industries Ltd | 0.63 | 1.74 | 1.18 |
| KANORICHEM.NS | Kanoria Chemicals and Industries Ltd | 1.24 | 1.6 | 0.83 |
| PANAMAPET.NS | Panama Petrochem Ltd | 0.02 | 1.12 | 1.1 |
| TIDEWATER.NS | Tide Water Oil Co India Ltd | 0 | 1.88 | 1.88 |
| TIRUMALCHM.NS | Thirumalai Chemicals Ltd | 0.43 | 1.28 | 0.97 |
| TNPETRO.NS | Tamilnadu Petroproducts Ltd | 0.14 | 1.26 | 1.14 |
| Low | High | |
| Unlevered beta | 1.06 | 1.12 |
| Relevered beta | 1.22 | 1.28 |
| Adjusted relevered beta | 1.15 | 1.19 |
IGPL.NS's CAPM model and how its cost of Equity is calculated
The Cost of Equity reflects the return a company needs to deliver to shareholders to justify the risk of investing in its shares. It’s computed using the Capital Asset Pricing Model (CAPM), which blends the risk-free rate, the stock’s beta, and the market risk premium.
This method evaluates the stock’s risk compared to a safe investment and the market’s overall volatility.
Here’s how we figure out the cost of equity for IGPL.NS:
cost_of_equity (17.70%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.15) + risk_adjustments (0.25%)
We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.